Once the future of retail seemed a matter of either, or: you’re either a legacy physical retailer or a dynamic new online retailer. But this is a false dichotomy. There are “smart” retailers that operate and thrive in both the physical and online worlds by paying attention to some innovative strategies.

Christmas shopping was different for me last year. Instead of spending hours in crowded stores, distracted by promotions, and “helped” by ill-informed seasonal workers, I adopted another strategy: online shopping to save time and money, and be more efficient and effective.

Instead, I spent as many hours shopping online as I would have offline. I scrolled through endless pages of products of different brands, guided only by filters such as “children’s clothing” or “color: blue.” I got lost in the millions of results of keyword searches and wasn’t even confident in the end that I got better gifts. The algorithms that “guided” me were not even as effective as the seasonal workers in the physical retail world. This was not “smart” retail.

Although online shopping may be convenient at times, it often falls short in creating a superior retail experience. Consequently, the share of online retail is relatively small. Despite the buzz about online retailers, most sales are still made in the physical world. This is “good” from both a societal and jobs perspective as small-scale retail is run by local entrepreneurs who employ many people.

Some traditional retailers have struggled, and others may be suffering, but even online sellers are establishing a physical retail presence. Such “smart” physical and online retailers will be the future of retail. They will provide an ability to sample wares and get expert advice while also giving access to a vast variety of goods and services online with very quick delivery. That’s smart retail.Here are a few strategies that make retailers “smart”:

Invest in Employees

It is a common trap for a traditional retail company: to save money, they fire sales personnel. But that’s shooting oneself in the foot, a dedicated salesforce is the biggest advantage retailers have. According to the Harvard Business Review, a better solution is to optimize labor levels so that customers get a positive shopping experience with guidance from store employees.

Investing in high quality customer service requires companies resist the urge to cut costs through reduced staffing levels, while also investing in enhanced employee training. Employees should be knowledgeable ‘mini-experts’ so they can guide and advise customers towards products they may like. Customer-contact employees are the “first-mile” of smart value-chains.

Such employee investment was a large factor behind Best Buy’s resurgence after disruption from online retailers, USA Today reported. After falling profits, Best Buy focused on investing in exceptional service and expertise through in-store, online, and in-home advisers for customers. Best Buy saw that by investing in employees they were able to act as superior service providers and product experts. The company believes this drove demand. Engaged employees also listened to customers and conveyed the information they gleaned upstream so that product features and available assortments could be tailored quickly.

Offer Unique Items

Another option for retailers to thrive in a “smart” retail world, is to offer unique items. One way to do this is for retailers to develop their own brands. This eliminates the risk of them being undercut on prices. Customers can truly only get these items from the retailer themselves.

Target has implemented this approach, CNBC reported. After seeing success in its Cat and Jack children’s clothing brand, Target rolled out 17 more brands, with plans for additional ones. Target has also begun store remodels to enhance this shopping experience making Target more of a “boutique” shopping experience, spotlighting their own brands.

This is also an especially good option for smaller, locally focused retailers. Many smaller book stores are seeing a resurgence by offering unique, local specific items

Host Online-Only Brands

Hosting online-only brands is another “smart” option for traditional retailers. It may sound counter-intuitive, but it makes sense. As many digitally native companies are looking to open brick and mortar locations, mall operators or retailers could use this “online-to-offline” trend to their advantage. They can offer flexible subleasing or revenue-sharing to hip online brands looking for a retail outlet.

Fabletics, a retailer of women’s “athleisure” is one online brand that has made this transition. Despite being digitally native, it has 22 brick and mortar stores already and plans to open 75 in coming years. Fabletics co-founder and actress Kate Hudson told CNBC that though the company was digitally native, “[Our customers] still want the retail shopping experience.”

These partnerships give traditional retailers access to customer bases of online brands while offering digitally native companies a physical presence without the costs and risks of opening their own locations. Partnerships could exist in many different formats, with traditional retailers renting space to online only brands or taking a cut of the profits from in-store driven sales.

Leverage New Technologies

Finally, “smart” retailers can leverage new technologies. They don’t need use “best” technology, but rather should use appropriate. M-Pesa in Kenya used regular mobile phones for a superior e-wallet solution. Meteorological and market data delivered to farmers on last-generation flip-phones allows them to figure out when and where to take their produce and how to adjust prices to maximize their gains. Just as digital payment systems facilitate the accompanying financial transactions, a similar approach in determining product assortments and dynamic pricing is used in “smart” online retail.

Smart retail continues to evolve to benefit buyers and sellers everywhere. Are you a “smart” retailer?